How to Learn From High-Quality Failures

The Transcript

How to Learn From High-Quality Failures

Jonny Nastor: This is Rainmaker.FM, the digital marketing podcast network. It’s built on the Rainmaker Platform, which empowers you to build your own digital marketing and sales platform. Start your free 14-day trial at HacktheEntrepreneur.com/Rainmaker.

Voiceover: Welcome to Hack the Entrepreneur, the show which reveals the fears, habits, and inner battles behind big-name entrepreneurs and those on their way to joining them. Now here is your host, Jon Nastor.

Jonny Nastor: We are back with another episode of Hack the Entrepreneur. Thank you so much for joining me. I’m your host, Jon Nastor, but you can call me Jonny.

My guest for today is the founder and Client Success Officer of Dream Local Digital, a startup helping small to medium-sized businesses market themselves online.

She has over 15 years of experience in Internet marketing, sales, and products.

My guest speaks all across the country about social media and online marketing. Now she’s here.

Now, let’s hack Shannon Kinney.

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Welcome back to Hack the Entrepreneur. We have another very awesome guest.

Shannon, thank you so much for joining me today.

Shannon Kinney: Thank you for having me.

Jonny Nastor: It is my pleasure. Let’s jump straight into this, shall we?

Shannon Kinney: Sure.

Jonny Nastor: Shannon, can you tell me, as an entrepreneur, what is the one thing that you do that you feel has been the biggest contributor to your successes so far?

How Being Open to Meeting a Lot of People Helped Grow Her Business

Shannon Kinney: Staying in touch with your network and being open to meeting a lot of people helps you in every role in every company that you’re in, particularly when you’re an entrepreneur. This business, Dream Local Digital, I found the thing that’s made me the most successful is that you can’t work ‘on’ the business and work ‘in’ the business at the same time.

My best practice here is to hire a strong leadership team, and allow them to do just that — allow them to lead. I empower them to run their departments and shape the company. That way I can focus on growing the business. Then because of that, it’s grown.

Jonny Nastor: Smart. I like it. There are two things there. Staying in touch with your network — I’m going to be a bit selfish because this is something that I feel that I definitely don’t do very well, especially now. I reach out to and I get to talk so many smart people, like yourself, and I feel I should be nourishing that in some way. How do you go about nourishing a network and staying in touch with them?

Always Staying in Touch With People in Her Network

Shannon Kinney: It’s much easier now with social media. My first startup was Cars.com. We had a team and clients and people all over the US, and I used to send cards and notes and emails and calls. Now, I do it largely through social media. On my entrepreneur side, a lot of it is Twitter, a lot of it’s LinkedIn.

It’s a disciplined approach to staying in touch with a lot of people, monitoring what’s going on with them so that, when and if you do get to talk, you’ve got a good sense of where they’re at. For me, I dedicate a certain amount of time to that every single day in terms of staying in touch with people.

The other key thing is I try to give more than I take. If anybody asks me for help and I’m capable of giving it, I try to jump in and do that because it always pays benefits.

The last part is I really think long range when it comes to my network. If somebody upsets me or a deal doesn’t go the way I want or something like that, you’ve got to just let it go because you’ll be surprised throughout your life how people come back into it. I find that giving more than you take always provides the best win in the long run.

Jonny Nastor: Yeah. Give more than you take definitely. I agree with that. The next part was you said that you can’t work ‘on’ your business as well work ‘in’ it. Did you know this? Did you bring experience from past places and know this going into Dream Local Digital?

Why You Can’t Work in Your Business and on Your Business

Shannon Kinney: That’s a good question. I did. In past jobs that I’ve had, I tried to, in businesses that I’ve started, I’m the kind of person who loves to jump in to the weeds. I have a lot of skills in the ops area. I love that part of the business, but I recognize that my business will stay small if it relies on me in those roles. It was a real lesson for me for this startup, which is my own money — or it was until 2013 — it’s no longer all my own money.

When I started that way, I recognized that it was really critical for me to build the future and build the legacy, not something that was just a job for myself. I’m fortunate that — if I look back at all my decisions that I made — that one decision was probably the one that was the real foundation to us getting as far as we have so far.

Jonny Nastor: Nice. I love it. Shannon, there’s a time in every entrepreneur’s life when they realize one of two things — either they have a calling to make something big in the world or they simply can’t work for somebody else. Can you tell us which one of those two you are?

Dreaming Big and Creating a Scalable Solution

Shannon Kinney: That’s an interesting point. I am definitely somebody who wants to make something bigger. I experienced that in this company where, initially, I had somebody working with me at a partner level. It was clear that really what she was looking for was a job she loved. We came to a crossroads really early in the relationship where I was like, “This isn’t about a job you love unless I’m going to go take the business in a direction and you’re going to work here.” That’s not how you grow a business.

For me, it’s always been about dreaming bigger and creating a scalable solution that can create a lot of jobs and tremendous value for our customers. I think there’s a real difference between people who do that and create a job. People who create a job, that’s important work, too. It’s just very different than trying to create something that’s bigger.

Jonny Nastor: Nice. Have you been as the leader and as an entrepreneur previously, though? Was this something that you’ve grown up in, or did your family come from that? Or is this something that you worked in like Cars.com and did these other startups and then were ready to take the plunge yourself?

Shannon Kinney: I’ve been in the Internet space since the mid ’90s. I was lucky enough to be on the ground level of several startups — Cars.com was one — as a key leader or person building it and making it happen. For me, I learned something new at every one of those experiences.

This one’s the first one that was something I started myself on my own. We’re now funded and have a terrific team of people who dream the same dream that I dream. It’s a very different thing when the company gives you a lot of money and says, “Build this.” That’s still a startup, but it’s an entirely different thing than, “Wow, build this or eat. Build this or buy something.”

It takes a fortitude that you don’t anticipate. Any time you think, “Well I can go two years without making money.” Whatever your estimate is, triple it, and recognize it’s going to require strength that you never thought you had — but to make it happen, it’s so gratifying. It’s so gratifying.

Jonny Nastor: Excellent. OK, Shannon, we’re going to move on to work. You have quite a team behind you now working with you. You haven’t created a job but you’ve created a business that isn’t all remote workers. It’s all located in Maine where you are, right?

Shannon Kinney: That’s right. About 80 percent of our employees are using one of our offices. They’re disparate, but the majority of them are in Maine.

Jonny Nastor: Excellent. I want to know now how you work. Today’s a work day. You started out, say, the first 30 or 60 minutes with probably some sort of a routine to set yourself up to get the things done that you need to get done today in your business. Could you walk us through that routine?

Her ‘Secret Sauce’ to Getting Things Done

Shannon Kinney: Sure. The first 30 minutes of my day are pretty critical. I also have a young daughter. I get up at 5 am and start working for two hours before she’s up and before I go into the office. My first 30 minutes, I do two key things. One is I try to use that time for creative work — anything that requires strategic thinking, a creative idea, planning, or anything I’m going to be doing. If I’m presenting to a team and trying to inspire them, I try to do that in the first 30 minutes.

The biggest enemy is that desire that wants to check all your notifications and check your email. Every time I start the day doing that, it’s a worm hole that all of a sudden my daughter’s awake. It’s time to go, and I’m running out of the house. So my first 30 minutes, I really try to think bigger about something creative and leverage the fact that I’m fresh and it’s the beginning of the day.

I used to be a really avid to-do-list person. I still have to-do lists — my team will be laughing when they listen to this — but I really practice the thought about what is your next action and really thinking the next action and focusing on that. Rather than this big to-do list like, “Conquer the world,” it will be, “OK. Here’s what I’m doing to do that today.” If I need any assistance in getting my next action list together for the day, that will probably happen in the first 30 minutes.

Jonny Nastor: Oh wow, nice. You do set it up in the morning, sort of assess what needs to be done. I know lots of people are telling me the night before they have to set up that, “what I’m going to do tomorrow,” or else it just falls apart on them.

Shannon Kinney: It’s so true, but if I find that at the end of the day or the night before, I’m not very fresh. I may look at my calendar or a list of things in a more negative light and be daunted, whereas first thing in the morning I’m like, “Oh I got this. This isn’t so bad.”

The one thing I will look at is my calendar so that I know where I’m supposed to be and roughly what’s going to happen during the day. I try really hard to only think about what are the actions to get through that day, not look at every message, because I drown in those things.

Jonny Nastor: I love that. I love the confidence in it. Lots of people like it the night before, and you just know that you’re not that fresh at that time. You like it in the morning because it sets you up, and that’s I think what you need to do. You need to find out how you work.

Shannon Kinney: That’s right. Some people are night owls. I like to do social things at night.

Jonny Nastor: Exactly. I like that. And that segues us in — so you are organized, you get up early in the morning, and you know how to stay in touch with your network. Now, every blog post, every expert out there in the world right now is telling us the 80-20 rule — do the 20 percent that gives you 80 percent of the results. Do what you’re good at and delegate the rest. Shannon, can you tell us something in your business that you’re absolutely not good at?

Having a Team That’s Strong Where Shannon Isn’t

Shannon Kinney: There’s two big things. One of them is I like to do the strategic planning and direction on where revenue is coming from — working closely with the customers to help the revenue. I have a director of operations who is brilliant at creating budgets, forecasts, making sure that the accounting is all done appropriately. She does a number of other amazing things as well, but she stays in touch of what happens once the money comes in and how all of that works. She and our accountant are really great at that, and that’s not my gift.

I think recognizing where your gifts are and where they aren’t and creating a team that complements you versus just says ‘yes’ to you all the time is a really key decision that you make running a business. I’m lucky that I have a team that supports me in those really well. It also pays to just have your ego in check and be like, “Hey, I know I’m not the smart one about this,” and look to those people to do it.

The other one is managing my calendar. It seems a very high maintenance situation, but I get so many requests or things or people trying to fit in my calendar that I could spend half the day answering emails and looking at my calendar and get nothing done.

It was key for me to finally accept that I needed to delegate that to someone else. It was hard for me because I don’t necessarily love the tone it sets with people who are trying to talk to me, but on the other hand, they get responded to. They get responded to way more quickly and efficiently than if it was relying on me to do it. Those two are the ones that have probably made the biggest difference in the business.

Jonny Nastor: That’s really interesting. It seems like they’re two very, very important things. By the way you described it, it sounds the first one with the revenue and taking control of the money once it comes in was something you knew in advance that you needed. Then it sounds the second one was something that you were kind of forced into because you realized you were doing it.

Shannon Kinney: I learned it. The numbers one, as an entrepreneur, you always have to know your numbers. You have to know them. You have to own them. You have to be part of making them happen, but I do that at a strategic level and as an owner of a business level. I understand that it’s not my gift in terms of from that high level, down to the street, and I’m very fortunate to have a team that is really strong where I am not.

Jonny Nastor: That’s awesome, and yeah, you’re right. You have to know those numbers. I find a lot of people struggle with putting somebody into that position earlier on because they’re more looking at generating that revenue — which isn’t always right — rather than controlling that revenue as it comes in because that’s really what usually sinks or allows the company to continue on. We’re always like, “No, we need people like sales people. We need marketing. We need people who will get us more sales.”

Shannon Kinney: Yep. There has to be a lot of trust. Every level in my organization requires a lot of trust. I need to hire and inspire the people around me so that we’re all moving in the same direction. Then I have to communicate really effectively with them. It’s not like I walk away and don’t do anything, but I do try to make sure that I have somebody who can add a lot of bench strength where it’s needed.

Jonny Nastor: Excellent. OK, we’re going to move to struggles and failures. It sounds like everything goes perfectly for you in your business, but I know that this probably is not the case.

Shannon Kinney: That’s so funny.

Jonny Nastor: As entrepreneurs and as human beings, one of our greatest struggles is the fear of being wrong, making mistakes, and failing. Shannon, can you walk us through how to be wrong in your business?

Embracing Failure and Taking Advantage of ‘Windows of Opportunity’

Shannon Kinney: Yeah. We move really quickly. We’re a startup, and I know a lot of entrepreneurs that are listening to this are probably in the same environment.

At my office, in the sales side of the business we call it a ‘high-quality no,’ and on the ops side of the business, it could be a ‘high-quality failure.’ By those, I mean those are life’s lessons. Very big things happen when it doesn’t go the way you expected. It takes discipline and a cultural process around embracing those moments and learning from them.

For us, the couple of things that we think of when these things happen is, the first thing is, you can’t take it personally or be defensive. In fact, defensive is probably the worst thing that can happen when you’re wrong or in a high-quality failure moment. I tell the team, “Open your mind. Open your ears. What happened?”

What we look at is why something happened. The goal is to really figure out why. Talk to others involved to get a sense of perception of why they said ‘no.’ If I made a mistake, “Why did we get here?” Then, we talk about how do we innovate our tactics, how do we innovate our marketing messages, how do we improve what we’re doing or coach our team members so that we learn from this experience.

We call them ‘windows of opportunity’ here. If you understand why and then you learn from it, being wrong is a gift — not a bad thing. We’ve had some bad ones here at the office. I guess everybody does, and I’ve had a couple that were particularly expensive, which is tough.

But if you go through the learning process afterwards — I look back at probably the worst one we had and I talk to my investors and say, “We are so lucky. That was like going to college is what that was, because here the 12 different layers of the operation that changed as a result of this experience, and we’re stronger now because of it.”

I wouldn’t have known that I needed these checks and balances if this mistake hadn’t happened. We get excited about them here and, definitely when it comes to the team, are not in any way judgmental about those experiences. If somebody gets defensive, is consistently making the same experience over and over, that’s a different story. When you’re wrong, be grateful. Then figure out what the plan is from there.

Jonny Nastor: Yeah, such a great philosophy on all of it — from both sides of the company and then also from you at the top of it. Even just explaining to your investors that this is like going to college, that’s hard to do when you’re in it.

Shannon Kinney: Got a degree. That little red spot on the spreadsheet, we went to college, and here’s what we learned. Fortunately, you set the expectation with them that these things happen going into it. You create a culture of learning around it that, by the time that they’re seeing the red spot in the spreadsheet, I can already talk about what’s happened since. A lot of that has to do with a systematic culture of how to deal with when you’re wrong.

If you’re an individual entrepreneur — I think I still struggle — that when you have those moments yourself, you need to have your little pity party and then move on. You can’t really focus in those areas at all because it’s an incredibly de-motivating experience. When you’re leading a team, you have to quickly shake it off and lead the people through it and not freak out about it. That is a skill that all leaders need to develop.

Jonny Nastor: Is it easier when the wrong or the failure, whatever you want to call it, is a company-wide decision or something that was not directly you having this gut feeling, being like, “We need to do go in this direction. We need to do this,” and then it’s, “Woah, this is completely not right. This didn’t work.” Is it easier when it’s not totally comes back to you, though?

Shannon Kinney: I think you learn the most from experiences that someone can take ownership over — even if it’s a leader of the department that says, “This happened because I didn’t coach this person through it,” or whatever. Ownership is a big part of learning.

At least if you can create a culture where people aren’t afraid to take ownership and they’re given tools and coached through things, then ownership actually isn’t hard to find.

I call my whole team honey badgers, and honey badgers do whatever it takes to get it done. We have this really competitive and driven group, but on the other hand, when one of them has a problem, they own it immediately. Everyone else immediately jumps in and starts trying to help.

There’s really not a lot of judging about the experience — unless, of course, the minute somebody starts getting defensive, what’s interesting is people don’t look at that as reflection on the mistake. They look at it as a reflection on the person. We try to teach people how to learn from these issues and create a supportive environment to help that happen and go from there.

Jonny Nastor: That’s amazing. Sounds you’ve created or are nourishing an amazing culture within your company. It really does.

Shannon Kinney: I think, as an entrepreneur, particularly if anybody else is working for you and you want them to believe in your dream and care about your business the way you do, you really have to focus a lot on culture. I try to spend a good portion of my week each week doing something that drives our culture forward, tells a story of our culture or contributes to it with the team.

Jonny Nastor: Excellent. So, Shannon, to end off, you’ve been working on the Internet now since when the Internet started being commercially viable.

Shannon Kinney: I’m not Al Gore.

Jonny Nastor: Yeah, I know. That’s awesome. It’s amazing. I love it. I love that we’re still within that range. That’s so cool.

Shannon Kinney: I know.

Jonny Nastor: You’ve worked in some cool companies that have done some great things. You now have your own thing going on. If for some god-awful reason your career was to end today, looking back, would you be happy with the legacy that you have got to leave behind up till now?

Building a Business That’s Sustainable Without Shannon

Shannon Kinney: I really think I have to be one of the luckiest people in the world because I really would be happy. I’m grateful to be able to say ‘yes.’ I’m deeply proud of the legacy behind me today. I’m proud of the footprints I’ve left, the connections I’ve made, and the results I’ve driven.

But I’m even more proud of the fact that I’ve built a company that will live far beyond me, will grow and succeed, and that my team is really strong. They see the vision, and they dream bigger the way I do. The company will go on to great things without me.

I obviously don’t look forward to that event, but I know, on any given day, that’s the case. For me, that makes me proud because I feel like, while I add a lot of value and I’m driving the business and building the business, it’s also a brand and team and process that’s sustainable without me. I think that’s what I’m most proud of.

Jonny Nastor: Nice. You really, really should be proud of that. In passing, we’ve got to talk a lot about your business. Could you leave by specifically telling my listener where they can find out more about you, Shannon, and more about your business?

Shannon Kinney: Sure. My business is at DreamLocal.com. You can find me, Shannon Kinney, on almost social network. My background’s on LinkedIn and a lot of that, but if you go to DreamLocal.com, you’ll see links to all of our social channels. Then find me from there.

Jonny Nastor: Excellent. I will link to that in the show notes to Dream Local. I will also put Shannon’s Twitter and LinkedIn straight into the notes, so they’re easy for you to find. Make sure you go, reach out to Shannon, and tell her you heard her on the show.

Shannon, thank you so much for joining me, and thank you so much for what you do. Please keep doing it. It’s just awesome to watch.

Shannon Kinney: Thank you. We’ll talk to everybody soon.

Jonny Nastor: Thank you very much, Shannon. That was a lot of fun.

Shannon has a great mind for business, a great mind for startups and growing these businesses. The way she knows exactly what it is she’s no good at and she knows she has to put people in that place so that her business doesn’t stay small, and her attitude towards failure — actually welcoming it and really just taking it all in — it’s awesome. It was great to hear. We all talk about failure and you got to deal with it, but she was like, “Just bring it on.” I love that.

She’s said one thing, though. She said this other thing that just really has stuck with me. It was that one thing. I’m not sure if you caught it. Did you get it? Did you hear it? Let’s do it. Let’s find the hack.

Shannon Kinney: I try to give more than I take. If anybody asks me for help and I’m capable of giving it, I try to jump in and do that because it always pays benefits.

Jonny Nastor: And that’s the hack.

Yes, yes, yes, Shannon, thank you. I try to give more than I take. This is amazing, amazing, and essential — beyond business, just in life in general, try and give more than you take.

When you go to a conference and you want to meet people, try and be more interested in them than interesting. Don’t try and always be Mr. Interesting or Mrs. Interesting. Just be interested in other people. Try and give. When people need help, give it to them. Don’t always worry about how you’re going to get paid or how you’re going to make money from that.

Trust me, in some weird way, the money does follow. It really does. The more and more people you can help — I’ve had people email me because I make it clear, Jon@hacktheentrepreneur.com. Email me — if you have a question, if you’re stuck on something, I would love to help you.

This isn’t a trick. This isn’t a catch. This isn’t me trying to put you on an email list. No, that’s not what I’m trying to do. I’m literally trying to help more people. I’m trying to give more than I take.

It’s something I’ve learned in the past couple of years. I’ve really gone all into it since last summer, and it’s paid off amazingly — not just in money even, which it has, but it’s the people I’ve met, the people I get to engage with. My inbox is full of amazing people emailing me with stuff they’re up to, stuff that they’re doing, questions they have. It blows my mind.

It doesn’t get any simpler than that. This hack was 10 seconds long or something. It’s amazing. Shannon just so succinctly said it — try and give more than you take. There’s really not that much else to it. Thank you, Shannon, because that needed to be said and that needed to be clarified. I really, really appreciate you saying it.

This has been fun. I said it before. I’ll say it again. I am driving with my family from Ontario to British Columbia or if you’re in the states, which you probably are, Minneapolis to Seattle — I think that’s actually the way we’re going to on the way there.

If you are on that path or somewhere close to it, email me. I just told you my email, Jon@hacktheentrepreneur.com or find me on Twitter. I’d love to buy you a coffee. I’ll buy you a beer if you really want. I would just like to hang out. I’d like to see you.

If you are on that path or if you’re in Vancouver or Seattle this summer, I’m going to be there for three months. Track me down. It’ll be fun.

This has been fun. This is always fun. I am absolutely blown away that you’re there listening. It really, absolutely, it means so much to me — you have no idea. I just truly, truly thank you for it.

Until next time, please keep hacking the entrepreneur.